Audit

Description

Experience Level: Expert

Background:

The Director and Company Secretary of x company also own, and are Directors / Company Secretaries of y companies (there may also be other Companies or trading names that they are using) all of which have a similar Raison d%u2019etre as x company

A conflict of interest exists and there is already evidence of funds and activity being diverted to these other companies with the consequential loss to our company.

X company is the trading company whilst z company is a dormant company. Company turnover is less than £60k

Due to this Director not submitting accounts for a 2 year period x company was struck off and we had to trade as a non limited company. The accountant and I resolved this issue and had the company reinstated. You need to be aware of this but it is not part of the investigation

Purpose:

The purpose of the audit is to establish the extent of any conflict in terms of both its direct and consequential impact on financial (and possible operational) issues.

Requirements:

To initially look at the last 4 years accounts and supporting documentation to specifically but not wholly concentrate on looking for:

%u2022 Evidence of funds being diverted or delayed being paid into our bank account(s).
%u2022 Evidence that they have used other bank accounts to process funds destined for our bank account.
%u2022 Evidence that proceeds from the Sale of Beach Huts, Commission on the Sale of Beach Huts and or Rental Income has been diverted away from us.
%u2022 Small sample check of Beach Hut Sales to confirm that the sales price realised agrees to the bank credit and that payments have not been diverted
%u2022 Small sample check of commission payments (as above)
%u2022 Company X being invoiced for services by any of their other companies.
%u2022 Evidence pf payments / costs being passed between the two companies
%u2022 Their personal expenses to be looked at in terms of their other companies activities
%u2022 Any evidence of funds being diverted to reduce tax liabilities

Audit Requirement

Amount of Time
%u2022 Two days to inspect accounts and supporting evidence
%u2022 Possible 1 day for further investigation
%u2022 1 day for Report
%u2022 Location Surrey / Sussex

Report:
%u2022 covering the points in the requirement section above
%u2022 collating financial loss to X company
%u2022 highlighting any Consequential losses
%u2022 providing evidence of any funds being diverted to reduce tax liabilities
%u2022 with recommendations if corrective action needs to be taken